Alaska cannabisThis is proving to be a big year for cannabis. As a result, we are ranking the fifty states from worst to best on how they treat cannabis and those who consume it. Each of our State of Cannabis posts will analyze one state and our final post will crown the best state for cannabis. As is always the case, but particularly so with this series, we welcome your comments. As a result of the overwhelming success of many cannabis initiatives this November, all the remaining states in this series have legalized the adult use of recreational marijuana. This week we head north to Alaska, which we rank number 5 among the states for cannabis.

Our previous rankings are as follows: 6. Massachusetts;  7. Maine; 8. New Mexico; 9. Nevada; 10. Hawaii; 11. Maryland; 12. Connecticut; 13. Vermont; 14. Rhode Island; 15. Kentucky; 16. Pennsylvania; 17. Delaware; 18. Michigan; 19. New Hampshire; 20. Ohio; 21. New Jersey; 22. Illinois; 23. Minnesota; 24. New York; 25. Wisconsin; 26. Arizona; 27. West Virginia; 28. Indiana; 29. North Carolina; 30. Utah;  31. South Carolina; 32. Tennessee; 33. North Dakota; 34.Georgia; 35. Louisiana; 36. Mississippi; 37. Nebraska; 38. Missouri; 39. Florida; 40. Arkansas; 41. Montana; 42. Iowa; 43. Virginia; 44. Wyoming; 45. Texas;  46. Kansas;  47. Alabama;  48. Idaho; 49. Oklahoma;  50. South Dakota.

Alaska

Recreational Marijuana.  The history of marijuana legalization in Alaska goes back to 1975 when the Supreme Court of Alaska decided Ravin v. State. Irwin Ravin was charged with possessing cannabis for personal use. He claimed his arrest violated his privacy rights under Alaska’s Constitution. The court agreed, holding that the right to privacy enshrined in the Alaska Constitution allowed Ravin to consume cannabis in his own home and went on to discuss the health significance of marijuana consumption:

Given the relative insignificance of marijuana consumption as a health problem in our society at present, we do not believe that the potential harm generated by drivers under the influence of marijuana, standing alone, creates a close and substantial relationship between the public welfare and control of ingestion of marijuana or possession of it in the home for personal use.

On November 4, 2014, Alaskan voters approved Ballot Question 2, legalizing the recreational sale and use of marijuana. Under this law, adults over the age of 21 may possess up to one ounce of cannabis and six cannabis plants but only three plants may be mature and producing flower.

The initiative created the Marijuana Control Board to oversee the legal recreational market in Alaska. The Board issues six different types of licenses:

  • Retail Marijuana Store
  • Standard Cultivation Facility
  • Limited Cultivation Facility
  • Marijuana Product Manufacturing Facility
  • Marijuana Concentrate Manufacturing Facility
  • Testing Facility

Alaska’s recreational market has been slow to develop, with retail sales only recently beginning in October. For more information on Alaska’s recreational market, check out the following:

Medical Marijuana. Voters approved the Alaska Medical Marijuana Initiative in 1998, but the initiative did not create legal dispensaries for patients to purchase cannabis. Instead, patients could either grow their own cannabis or appoint a caregiver to grow on their behalf. As such, Alaska has no legally sanctioned medical marijuana market. That combined with protection for the home use of marijuana in the Ravin decision has allowed for a thriving illegal cannabis market. This is likely to change now that Alaska’s recreational cannabis market is now operational. This makes Alaska different from states like Oregon, Colorado, and Washington, all of whom had independent medical marijuana markets operating when recreational cannabis was legalized. Alaska’s medical marijuana market is almost non-existent and it’s likely that both medical and recreational users in Alaska will purchase their cannabis from retail marijuana stores.

Bottomline. Alaskans have had a right to use cannabis in the privacy of their own homes since 1975. The medical marijuana market was never truly operational, but Alaskans are finally getting a chance to legally purchase marijuana as retail stores start to open. For its long legalized cannabis history and, more importantly, its legalized recreational cannabis present, Alaska lands at number five in our rankings on how the states treat cannabis.

Cannabis insuranceWith the advent of state-legal cannabis, the businesses that make up the rapidly growing billion-dollar cannabis industry are still having to struggle to secure many professional services non-cannabis businesses obtain as a matter of course – most notably banking. One bright spot for cannabis businesses, however, is insurance. Dozens of insurance companies that cater to the cannabis industry have sprung up in recent years and federal courts have held cannabis inventories is insurable despite federal prohibition.

But, what if you cultivate state-legal marijuana at home for your own use? Will your general homeowner’s insurance policy cover cannabis plants in the event of theft or fire? A number of large insurance providers would tell you the answer is “no,” and federal court decisions do not consistently side with policyholders. Here is what you need to know about the state of the law and factors to consider when approaching the issue of insuring cannabis in your home.

A U.S. District Court in Hawaii ruled in 2012 that the federal prohibition on cannabis meant that a homeowner’s insurance policy did not cover the theft of medical marijuana plants grown in accordance with state law. The policy in question contained an exclusion for coverage of “cocaine, LSD, marijuana and all narcotic drugs,” but included an exception for “legitimate use of prescription drugs by a person following the orders of a licensed physician.” The plaintiff argued that because she had fully complied with Hawaii’s medical marijuana laws, her plants should have been covered under her homeowner’s insurance policy. The court disagreed, concluding that it could not enforce the insurance contract against the insurer because of the Controlled Substances Act and the supremacy of federal law. A more recent case, on the other hand, should give policyholders hope: a 2016 decision in the U.S. District Court in Colorado held in favor of a cannabis business that sought coverage for its cannabis inventory. Like many aspects of state-legal cannabis, however, the insurability of cannabis is likely to remain uncertain and contested and state-by-state until there is reform at the federal level.

So, what should you do to protect yourself and your plants if you grow at home?

  1. Look at your policy and talk to your insurance provider. The terms of a homeowner’s insurance policy can vary, but most include some version of the language above regarding controlled substances and illegal activities. Only your insurance provider can tell you if it considers state-legal cannabis cultivation to violate this clause. Some insurers are more aggressive about enforcing these provisions than others.
  2. Do not become a business. Nearly all homeowner’s insurance policies do not cover business activities. The definition of what that means is not uniform in all jurisdictions, but be especially careful if you are a caregiver cultivating marijuana for someone else or if you sell your excess cannabis supply into state-legal channels.
  3. Stay compliant with state laws. It should go without saying, but be sure to maintain compliance with all state laws. At issue in the case from Hawaii was whether the plaintiff had more than the allowed number of cannabis plants under Hawaii state law. Even if you have a friendly insurer, failing to follow state marijuana laws will be a deal breaker. No insurer will be obligated to cover damage or theft to marijuana plants in excess of state limits.

For more on growing cannabis in your home state, check out the following:

 

Cannabis clubsBefore the wave of cannabis reform that has swept the United States over recent years, Amsterdam’s cannabis “coffee shops” were the quintessential international icon of legal cannabis consumption. Yet, even as more and more states legalize cannabis, laws allowing consumption in social establishments are all but nonexistent. Will cannabis clubs in the United States ever reach a degree of acceptance similar to Amsterdam’s coffee shops, or, better yet, be treated like bars and clubs that serve alcohol? Recent developments in Alaska and Colorado highlight both the obstacles facing social cannabis establishments and a possibly encouraging step forward for proponents of these clubs.

Alaska’s Attorney General Jahna Lindemuth recently issued an opinion declaring cannabis clubs illegal unless they are licensed as a retail cannabis dispensary. The opinion comes as several cannabis clubs have popped up in Alaska since it approved cannabis legalization. Cannabis clubs, in Alaska and elsewhere, are establishments that provide space for patrons to consume cannabis, socialize, and play games. The clubs — which do not themselves sell cannabis — operate under the theory that they fall outside the scope of the cannabis laws because they do not sell cannabis. Attorney General Lindemuth counters this view by arguing that the law prohibits consumption of cannabis at any “place of amusement or business” other than a licensed retail cannabis store. Lindemuth asserts that the clubs are commercial places of business because they typically charge an entry fee and sell snacks and other refreshments. She also contends that even if a cannabis club is not a place of business it constitutes prohibited “public” consumption if a “substantial” number of people are present. Lindemuth’s opinion effectively puts an end to cannabis clubs in Alaska unless and until its laws are changed.

Denver voters this November will decide whether to approve a measure that would allow regular businesses like bars, coffee shops, and other establishments to have indoor or outdoor spaces for cannabis consumption. These businesses would be allowed to have cannabis spaces if they first obtain a permit and, also have a sponsoring neighborhood organization or business improvement district. The sponsor would participate in the permitting process by submitting proposed conditions that regulate how the business will implement its consumption areas.

The law is pitched as a pilot program and would sunset in 2020 unless extended. Even if voters approve the measure, Denver City Attorneys have expressed concerns regarding whether it conflicts with Colorado’s Amendment 64, which does not authorize cannabis clubs. That has not stopped a handful of other Colorado towns from allowing cannabis clubs, but if Denver’s embracing social cannabis would be a game changer.

Beyond state and local cannabis laws, other challenges to social cannabis consumption loom. Most obviously, near-ubiquitous indoor smoking bans could make the most common form of cannabis consumption impossible in most jurisdictions — an obstacle well known to hookah lounges. Nonetheless, social cannabis reform could usher in an age of widespread vaporizer lounges and cannabis-infused edible restaurants. It may seem far-fetched now, but it was not too long ago legal cannabis retail stores were just as novel.

Home grown cannabis lawsAs cannabis reform has spread across the United States, it has given birth to a marketplace increasingly driven by business interests. This is the second installment in our series looking at how the changing landscape of cannabis policy affects a key group of often-overlooked stakeholders: medical marijuana patients who choose to cultivate their own supply of medicine. Go here for part one, on the home grown laws in Washington and Oregon. Though there are undeniably many benefits to the expansion and professionalization of the commercial cannabis industry, it is also important to account for these small-scale medical marijuana producers that started it all. Continue Reading Home Grown Marijuana: California and Alaska

When it comes to investment in marijuana businesses from non-residents, states are either in or they’re out. Some states, like Colorado, Oregon and Washington, require in-state residency for a certain amount to qualify for investment or ownership in a cannabis business. Other states, like Illinois and Nevada, have no residency requirements, but count residency as a favorable factor in a licensing application. The policy question always looms: should a state allow outside investors to ensure that its cannabis businesses are well-capitalized or should it choose a more protectionist model that arguably lends itself to easier policing?

Alaska will (at least this week) be having strict residency requirements for its cannabis business licenses.
Alaska will (at least this week) be having strict residency requirements for its cannabis business licenses.

Alaska, a state with both medical and recreational marijuana, has battled itself over whether strict and onerous residency requirements should be in place for “outside investment” in its recreational marijuana industry or whether such investment should be an easy process with less invasive residency standards. For better or worse, it has now opted for the former.

In late November, Alaska’s Marijuana Control Board adopted rules relaxing residency requirements for owning and operating a marijuana business under Ballot Measure 2 (codified at A.S. 17.38), the state’s recreational marijuana initiative. The former regulations mandated that all recreational marijuana businesses be 100% Alaska-resident owned and capitalized. The all-Alaskan ownership standard never changed, but the definition of “resident” did. Specifically, the old regulations defined “resident” as “a person who meets the residency requirement for an Alaska permanent fund dividend in the calendar year in which that person applies for a marijuana establishment license under this chapter.” According to Alaska’s Department of Revenue,

The Alaska Department of Revenue, Permanent Fund Dividend Division is responsible for determining applicant eligibility for the distribution of an annual dividend that is paid to Alaska residents from investment earnings of mineral royalties. The annual payment allows for Alaskans to share in a portion of the State minerals revenue in the form of a dividend to benefit current and future generations.

Eligibility for the Permanent Fund Dividend hinges in part on certain fairly intense residency requirements. In particular, the Permanent Fund Dividend Division stipulates that “[a]n individual’s intent to establish residency, remain indefinitely in Alaska, or to return to Alaska and remain indefinitely is demonstrated through the establishment and maintenance of customary ties indicative of Alaska residency and the absence of those ties in another state or country.” Proof of establishing residency and the intent to remain indefinitely in Alaska may include proof through documentation of the following:

  • a contract to move household goods to Alaska dated prior to the qualifying year (Employer paid moving contracts are not an acceptable tie)
  • proof of home ownership, a home purchase contract, rent receipts, or other proof that the individual maintains a principal home in Alaska. (Employer paid housing is not an acceptable tie)
  • employment records
  • school records
  • voter registration and voting records
  • motor vehicle registration records

In evaluating whether an individual claiming Alaska residency has demonstrated intent to remain indefinitely in Alaska, the Department of Revenue will consider whether or not an individual has:

  1. taken steps to establish Alaska residency and sever residency in a previous state or country;
  2. ties to another state or country that indicate continued residency in the other state or country; and
  3. taken other action during the qualifying year, through the date of application, that is inconsistent with an intent to remain in Alaska indefinitely.

Though the Alaska Marijuana Control Board was at one point prepared to use the above criteria to determine residency for purposes of cannabis licensing in Alaska, as of November 24th, it stated that it would instead be using the residency criteria required for obtaining voter registration in Alaska. which are considerably less stringent than the residency requirements to receive the monetary dividend. One can meet Alaska voter registration requirements with a physical address in the state and by renouncing your state voter rights elsewhere. There was no minimum time required for a recreational marijuana applicant to have resided in Alaska.

But by December 1, Alaska’s Marijuana Control Board went back on relaxed “voter registration” residency standards and instead adopted the Permanent Fund Dividend criteria, meaning that anyone wanting an Alaska cannabis business license must be able to demonstrate at least one calendar year of residency in Alaska. So, if you are not already a year-long resident in the State of Alaska, you can pretty much forget any immediate ownership or investment in what likely will be (at least initially) a very limited recreational marijuana industry in the Last Frontier.

Alaska’s Department of Law (i.e., the Attorney General’s Office) still has to review the Board’s adopted rules to ensure that they comply with the Ballot Measure (and probably with the Cole Memo as well), so these rules aren’t fully final yet but it’s only a matter of time before they almost certainly will be.

Alaskans voted to legalize marijuana earlier this year, and late last month the Alaska Marijuana Control Board made changes to the regulations that will govern the marijuana industry in the state. The below summarizes the Board’s key changes.

Alaska's Marijuana RulesWhere Does The Money Come From?  A key issue for the marijuana industry in every state is finding the right balance between resident and out-of-state investors. We discussed the pros and cons of residency requirements here. The Alaska Board had to balance protecting local investors while also trying to make it easier for Alaska marijuana businesses to access the deep pockets of out-of-state investors. In large part because Alaska is such a small financial market, the Board ultimately leaned towards making it easier for outside investors to bring their dollars to The Last Frontier (though several Board members felt the new rule went too far in lowering the barrier to outside investment). The finalized rule reduces the residency requirement from the “permanent fund residency rules,” which require a full calendar year for an investor to gain residency, to the “voter registration residency rules,” which requires only 30 days and an Alaska address.

“Public” Consumption Of Marijuana? The Board also considered the issue of “public” consumption of marijuana in retail stores and “pot clubs.” Figuring out where and how marijuana might be consumed in a semi-public setting, (think Amsterdam “coffeeshops”), is a big deal, and Alaska has been on the forefront of this issue.

First, the Board had to decide what to do about “pot clubs” — private clubs with membership fees that allow members to bring their own marijuana to consume in a social environment. The Board decided it lacked authority under Ballot Measure 2 to regulate pot clubs because the Measure did not explicitly create a license for such entities. This finding leaves pot clubs free from Board regulations, but still on shaky legal ground. The legal concern with “pot clubs” is that they may fall under the definition of a “public place,” in which case consumption there could be punishable with a $100 fine. The Board’s emergency rules do not offer a clear answer as to whether pot clubs fall under the definition of “public place” or not, and there has yet to be any further instruction from administrative bodies, the legislature, or from litigation to offer a clear answer.

Second, the Board had to consider whether to allow consumption in marijuana retail stores. It decided to allow onsite consumption by enabling marijuana retail establishments to request “onsite consumption allowances” from the Board. The new rules will also allow retail establishments to sell snacks, beverages, and refrigerated products. Alaska is the first state to allow in-store consumption and so its experiment with this will no doubt be watched closely by the rest of the country.

Other Changes.  The new rules also addressed several other important issues:

  • The Board decided to keep the buffer for children’s centers, schools, and churches at 500 ft., an issue which was of particular concern for Alaskans because of their small towns and densely packed tourist areas.
  • The Board eliminated brokerage licenses, which would have created and regulated marijuana brokers as middle-persons between cultivators and retailers.
  • The Board voted to allow branding in Alaska’s marijuana market.
  • The Board decided mandated that marijuana products leave stores in opaque, childproof containers. It refused to implement stronger proposed childproofing requirements on the grounds that children are the responsibility of their parents, not marijuana retailers.
  • The Board eliminated potency limits for marijuana.

For more on Alaska’s new rules, check out this Alaska Journal of Commerce article.

On November 20, Alaska’s Marijuana Control Board voted to allow consumption of marijuana at licensed retail stores. The amended regulation must pass through a few more procedural hurdles before going into effect. The Department of Law will conduct a formal review on the new regulation and then it will be submitted to Lt. Gov. Byron Mallott for final approval. If this regulation ultimately passes, Alaska will become the first state to allow for marijuana consumption bars.

Alaska may become the first state to allow cannabis bars. This makes us very happy.
Alaska may become the first state to allow cannabis bars. This makes us very happy.

This will be a huge deal.

Prior to November 20, the Board maintained that it lacked authority to create a new type of license because Alaska’s legalization initiative created only four types of cannabis licenses: retail, cultivation, manufacturing, and testing. Instead of creating a new license for marijuana bars, the Board chose to allow consumption under a retail license. The Board also sidestepped Alaska’s law prohibiting marijuana consumption in a public place. The proposed regulation would exempt retail stores from being defined as a public place.

Despite this change by the Board, limitations on marijuana consumption in retail stores remain. According to Alaska Dispatch News, members of the Board stated that this law does not impact local smoking prohibitions. Unlike many other states, Alaska does not have statewide prohibitions on smoking, but its municipalities can enact their own localized smoking prohibitions and though these no-smoking laws were put in place to prevent tobacco smoke, they also apply to marijuana. For example, Anchorage prohibits smoking in all public places and places of employment. Though retail stores are exempted from the Alaska state law definition of “public place,” they would still be considered a place of employment under Anchorage law. Therefore, a retail store in Anchorage could not permit its patrons to smoke marijuana in the store, but they could permit them to consume it in other ways.

If Alaska moves forward (and my firm’s Alaska lawyers tell me that it will) it will mark a major departure from other states that have legalized adult use marijuana but failed to provide a legally sanctioned place to consume. All of the other states that have legalized recreational marijuana so far (Colorado, Oregon and Washington) prohibit consuming marijuana in public places. This makes it very difficult for the homeless, tourists, renters, and condominium owners, whose buildings or hotels likely forbid smoking and/or marijuana use, to find a place where they can legally consume. As we have written previously, landlords can still legally evict their tenants for smoking.

Our kudos to Alaska.

Telemedicine is booming. Telemedicine (sometimes referred to as Telehealth) is the use of telecommunication and information technologies to provide clinical health care at a distance. Telemedicine is developing over a growing variety of applications and services, including two-way video, email, and texting. Skype calling your doctor to discuss and show them your symptoms is just one example of telemedicine.

Telemedicine gives patients access to doctors and their medical advice without the burden of travel. It also can connect specialists with patients around the country (or even the world) where such connections might otherwise be difficult or even impossible.

State policies on telemedicine vary greatly. The various state rules on telemedicine are created by state medical boards, who are tasked with regulating medical licenses. Doctors must follow the regulations and guidelines of their state medical boards.

Given the foregoing, it begs the question whether medical marijuana can take advantage of this modern advancement.

Can Doctors Recommend Medical Cannabis Using Telemedicine? Many states require a healthcare provider and his or her medical cannabis patient have a pre-existing, bonafide relationship. Most states also require an in-person examination of the patient before any recommendation of medical marijuana, in addition to various requirements regarding follow-up care. Still, in some states it is not clear whether this doctor-patient relationship may be established virtually.

On the other hand, some states explicitly prohibit physicians from recommending medical cannabis via telemedicine. Colorado’s Medical Board took this approach last August. Illinois also directly prohibits the practice. And Washington requires healthcare providers to complete “an in-person physical examination of the patient” to issue a medical cannabis authorization, rendering telemedicine a moot point. Some states that allow medical cannabis have not directly addressed the issue of recommending cannabis through telemedicine, leaving doctors with little guidance on whether they will face consequences for engaging in this practice.

California Leading the Way. In October 2014, the Medical Board of California stated the following regarding cannabis telemedicine:

The initial examination for the condition for which marijuana is being recommended must be an appropriate prior examination and meet the standard of care. Telehealth, in compliance with Business and Professions Code section 2290.5, is a tool in the practice of medicine and does not change the standard of care.

This is significant because California is the only state whose medical board has explicitly set forth an affirmatively favorable policy regarding telemedicine and medical cannabis. This clarity has allowed California doctors to recommend medical cannabis via telemedicine without fear of losing their license to practice medicine.

However, California recently overhauled its medical cannabis laws and those new laws may impact cannabis telemedicine in California. Senate Bill 643 (SB 643), which goes into effect on January 1, 2016, sets forth standards for licensed medical physicians who recommend cannabis for medical use, including the fact that:

No person or entity may prescribe, dispense, or furnish, or cause to be prescribed, dispensed, or furnished, dangerous drugs or dangerous devices, [] on the Internet for delivery to any person in this state, without an appropriate prior examination and medical indication[.]

Though this new law can be read to prohibit doctors from recommending cannabis through telemedicine channels, it also can be read to allow for recommendations via telemedicine if California continues to consider a doctor-patient examination through telemedicine a legitimate “appropriate prior examination.” California agencies will process rules and regulations related to SB 643 probably until January 2018.  During this time, I expect California’s Medical Board to provide further guidance on telemedicine, and I expect that guidance will ultimately favor telemedicine and cannabis especially under California’s imminent hardcore MMJ regulatory regime.

So, What’s Next? We’ll likely will see more states grapple with telemedicine as they consider medical cannabis legalization. This issue is especially relevant in states with geographically spread out populations, such as Alaska. We will keep you updated.

Marijuana delivery rules vary greatly and can be very complicated. Businesses that want to offer delivery to consumers must comply with state laws and regulations. Some states, like Washington, have a blanket prohibition against businesses delivering marijuana to consumers. Conversely, Oregon recently announced rules to allow retail deliveries. This post examines how the Alaska, California, Hawaii, and Oregon regulate marijuana delivery.

Cannabis delivery. When it absolutely positively needs to get there fast.
Cannabis delivery: when it absolutely positively must get there fast.

Alaska. Alaska will allow cannabis delivery services, but the regulatory details of cannabis delivery in Alaska remain unclear. Alaska has not yet started issuing licenses for businesses to sell marijuana and its sale remains illegal. The Alaska Marijuana Patrol Board is currently considering rules to regulate the market. Those rules will likely impact how businesses deliver marijuana in Alaska. Until those rules are in place and the state starts issuing licenses for the sale and delivery of marijuana, businesses that deliver marijuana may face criminal prosecution.

For more on Alaska cannabis laws, go here.

California. California recently overhauled its medical marijuana laws by passing of three new bills. Assembly Bill 266  explicitly allows dispensaries to deliver medical marijuana to qualified patients or primary caregivers. However, local jurisdictions still have the ability to prohibit marijuana deliveries and to set the tax rate for delivery transactions.

Only licensed dispensaries are allowed to deliver marijuana and all dispensary employees involved with a delivery must carry a copy of the dispensary’s license, along with a government-issued ID. Additionally, the dispensary must bring a physical copy of the delivery manifest.

For more on California cannabis laws, go here.

Oregon. The Oregon Liquor Control Commission (OLCC) recently issued temporary rules for recreational marijuana that allow Oregon marijuana retailers to deliver marijuana to a residence, but not to “commercial businesses” such as dorms and hotels. Before a retailer begins offering delivery services, it must obtain written permission from the OLCC.

Retailers may only deliver cannabis to an individual who has made a “bona fide order” for it. These orders must include the individual requestor’s name, date of birth, date of delivery, address, amount of marijuana purchased, and a statement that the marijuana is for personal use and not for resale. The delivery person must verify that the individual receiving the delivery is at least 21 years old and is the person who placed the bona fide order. A bona fide cannabis order may be done online.

Retailers are allowed to deliver only between 8:00 a.m. and 9:00 p.m. The recipient of the cannabis must sign a document stating that he or she received the cannabis. The delivery person may not deliver marijuana if the recipient is visibly intoxicated at the time of delivery. Only one order per day may be delivered to a single physical address. Marijuana for delivery must be in a container with a label that says: “Contains marijuana: Signature of person 21 years of age or older required for delivery.”

Retailers are not allowed to carry or transport more than “a total of $100 in retail value worth of marijuana items designated for retail delivery.” The retailer may not make unnecessary stops during the cannabis delivery nor deviate substantially from the route created in the retailer’s manifest for that delivery. Retailers must keep a record of every marijuana delivery for at least a year. Deliveries may only be made in the city or unincorporated county where the retailer is licensed. Marijuana cannot be delivered to a residence located on privately owned land.

For more on Oregon cannabis laws, go here.

Hawaii. Hawaii recently overhauled its medical marijuana program but those changes do not allow for delivery of medical marijuana to patients. House Bill 321 states that a “dispensary shall be prohibited from off-premises delivery of marijuana or manufactured marijuana products to qualifying patients or to primary caregivers of qualifying patients.”

For more on Hawaii cannabis laws, go here.

The Bottom Line. Marijuana delivery rules vary greatly by state and by localities within the states. In those states that allow for commercial deliveries of cannabis (Alaska, California, and Oregon) the rules are new, complicated, and uncertain. Be careful out there.

 

Marijuana Delivery ServicesSo, you want to start a marijuana delivery service? Not so fast. What you want to do may or may not be legal in your state.

State law varies significantly on the issue of cannabis delivery. Lawmakers have made cannabis delivery businesses illegal in some states, usually to avoid coming up against federal enforcement priorities outlined in the Cole Memo by preventing cannabis deliveries that may be diverted out of state. However, some states allow cannabis deliveries.

The below is a quick rundown on where Alaska, California, Colorado, Illinois, Nevada, Oregon, and Washington stand with respect to the legality of cannabis deliveries.

Alaska:  Alaska legalized recreational cannabis in February 2015 but licenses for recreational shops will not be issued until sometime in 2016. When the Alaska market is up and running, you should expect to see delivery services right away as they are allowed under the new laws.

Alaska previously banned MMJ deliveries outright, but the state has taken a different approach with recreational cannabis. The law that legalized marijuana in Alaska, Ballot Measure 2, expressly calls for “delivering, distributing, or selling marijuana or marijuana products to consumers.” One of the reasons Alaska legalized deliveries is because it has so many “outposts” where there may be no local source of supply.

California:  California has not directly addressed the delivery of MMJ at the state level. Instead, counties and cities decide whether to allow delivery, resulting in a patchwork of local regulations around the state. Los Angeles, one of the largest cannabis markets in the nation, may allow for delivery, but it is unclear. Proposition D, seems to allow for the issuance of MMJ licenses to vehicles, which suggests that delivery services are allowed. However, Proposition D also restricts licenses only to MMJ businesses that were licensed in 2007 and, at that time, no delivery services were actually licensed. Despite that ambiguity, businesses may want to steer clear as the L.A. City attorney has made it a priority to shut down at least one major marijuana delivery app.

Colorado: Colorado prohibits delivery of recreational cannabis, but MMJ deliveries are allowed so long as they are not done for profit. Only a patient’s primary caregiver can make a delivery.

Illinois: Illinois allows delivery by a patient’s primary caregiver, but otherwise prohibits cannabis deliveries.

Nevada: Nevada permits the delivery of cannabis from a retail Medical Marijuana Establishment to “[a] person who holds a valid registry identification card or his or her designated primary caregiver.” The delivery process is heavily regulated to ensure that product is not diverted while in transport.

Oregon: Oregon’s MMJ rules prohibit cannabis deliveries, but Measure 91 (the initiative that legalizes recreational cannabis) states that “deliveries may be made by the marijuana retailer to consumers pursuant to bona fide orders received on the licensed premises prior to delivery.” We read this to mean that if a consumer places its order in a retail store, an order can be delivered to the consumer at another location. If this portion of the measure stands, it would seem that a consumer could go to his or her favorite marijuana retailer and place a standing order for X quantity of Y strain to be delivered every Tuesday for the next year. It would even seem that this same consumer might be able to call, text message, or communicate via an app to the retailer to adjust their standing order. We fully expect the Oregon Liquor Control Commission to expand on and fully define marijuana deliveries as a result of its upcoming rule-making process.

Washington: Cannabis deliveries are illegal in Washington, and this holds true for both medical and recreational marijuana. The State Senate recently passed Senate Bill 5052, which overhauls the State’s current medical marijuana laws (which laws formerly allowed for delivery). Despite massive changes in state law, the delivery of all cannabis is now illegal.